# Answer To Accounting Test Question SWO No. 1 On Stock Loss

Answer to Accounting Test Question SWO No.1:

(A ii) Computation of Adjusted Value of Wintnerâ€™s stock at 31 March 2006

 \$ \$ Balance of stock 64,670 Add: goods purchased 2,830 Goods returns (100/125 x \$180) 144 2,974 67,644 Less: Credit sales (100/125 x \$2,120) 1,696 Cash sales (100/125 x\$1,320) 1,056 Goods returned to supplier 450 3,202 Adjusted stock value 64,442

 Adjusted stock value 64,442 Less: reduce in stock value (\$3,000-\$2,500) 500 Revised stock value 63,942

From the above computation, the decrease in stock will affect the stock valuation by \$500 which is (\$3,000-\$2,500)

Summer

Computation of Stock Loss :

 \$ Opening stock 68,200 Add: Purchases 184,300 Goods available for sale \$252,500 Less: Cost of Sales 189,600 Closing Stock \$62,900 Less: Physical stock value 12,600 Stock loss \$50,300 Add: Damage to premises 4,600 Total Insurance Claim \$54,900

The total insurance claim is \$50,300+\$4,600 = \$54,900

Working details for Cost of Sales:

Since Selling price is 1331/3%

Therefore Cost of sales = 100/1331/3 x \$252,800 =\$189,600

Or alternative working:

Mark-up =331/3% =1/3

Margin =1/4

Margin = Gross Profit/Sales

=1/4 =Gross Profit/252,800

Gross profit = \$63,200

Cost of sales = Sales â€“ Gross Profit =\$252,800-\$63,200 = \$ 189,600

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